Its Over, page-23898

...50bps more is not more than what the markets had been hoping for (75-100bps)

...but we have the threat of the East coast port strike that could cripple US supply chain, forcing delays in shipment and cause prices to rise (again), and the hurricane and Middle Eastern war, all serve to put the Fed on notice not to take disinflation for granted.


Jerome Powell has said that there is nothing suggesting a downturn is more likely now than previously
01/10/2024

The U.S. economy appears to be on track for continued easing in inflation, which should enable the Federal Reserve to reduce its benchmark interest rate and eventually reach a level that no longer restrains economic activity, Fed Chair Jerome Powell said on Monday. Speaking at the National Association for Business Economics conference in Nashville, Tennessee, Powell emphasized that the Fed has no predetermined path for rate cuts, stating, "The risks are two-sided, and we will continue to make our decisions meeting by meeting."


Powell indicated that he expects two more rate cuts this year, totaling 50 basis points, assuming the economy performs as anticipated. However, he noted that the Fed could adjust its pace of rate reductions depending on economic conditions, either cutting faster or more slowly as needed.

At the Fed's Sept. 17-18 meeting, policymakers lowered the interest rate by half a percentage point, bringing it down from a 20-year high of 5.25%-5.50%—which had been maintained for 14 months—to a range of 4.75%-5.00%.